Lots if issues in one! Advice needed

silvercar

Money_Bunny wrote: »

I think you misunderstand me. You have the right to extend the leasehold because you've been in the property more than two years. If someone bought the property they the wouldn't have been there two years so they wouldn't have the right to extend - the freeholder could agree to extend (obviously for a price) but the freeholder could equally just refuse. The new owner might have to wait two years until they had the right to extend by which case the cost to extend would have gone up.

cfcboy wrote: »

Yes i understood, sorry my reply might have seem a bit confusing. Yep know the two year rule, ive been discussing with the estate agent that we put a written caveat into the sale that i will extend the lease at time of sale, so i use the funds of purchase to subsidise the lease extension to obv get a good price. thankfully prices in my area (i live in west berks) have been pretty stable and recently seem to be on a decent rise.

The other alternative as you say is to try and sell now with the 71 year lease or hold off for a couple of years where the extension could have easily risen by 3-4k and make it unsellable beyond the 70 year mark (if it isnt already).

Not sure, its getting me so stressed out

Standard procedure in your situation is to sell priced with an extended lease and extend the lease yourself at time of sale, the cost of doing this comes out of the sale price. Any decent solicitor will sort this for you as part of handling the sale.

The only problem is that this can take time, so you really should get the solicitor onto the case ASAP.

dimbo61

My view !
Renting somewhere else for £1K a month :-(
You have a very low Interest only mortgage payment now of £460
You need for the next 12 months to save every penny you can and clear debts
I doubt the cost of the lease extension will jump that much in 12/18 months .
Sit down with the other half and review everything
Lunch take a butty box with fruit/bread/fillings from Aldi/Liddle .
No papers, magazines, books. Buy the OH a kindle for Xmas/birthday great selection of free books/papers/mags all free.
Holidays in UK at campsites your child will love it.
Buy a cheaper car to run, tax, insure
It takes hard work and time to change bad habits you have built up.
I drive a 10 year old car, live cheaply and work hard to become mortgage free.
Can you get a second job ? Make stuff to sell ? Flog old stuff on eBay ?
Selling up and moving to rented would cost a lot of money and you could then struggle to buy another property as most lenders now want repayment mortgages
Only my views Good Luck

SternMusik

I agree with other posters that the key is to reduce your outgoings. You could live well for a lot less money I think. This isn't about being miserable all the time. If I was you I'd ditch things like Sky immediately. Sky doesn't make you and your family happy. If you want to spend money then do it on things that actually create memories for you and your child. Things like days out to the museum, picnics in the park etc are very inexpensive entertainment and far more stimulating than sitting in front of the telly. With the savings you make you could then attack the highest APR debt first (assuming it doesn't incur an early repayment penalty).

Unless you need your iPhones for work I'd seriously think about selling them, getting cheap PAYG phones and ditching the insurance. It's all for the good cause of keeping an affordable roof over your head!

Now, regarding your flat, and assuming you want to stay there, it is worth finding out how much a statutory lease extension is now compared to a year and two years from now. Compare the annual increase to the APR on your debt, and then attack whatever has the highest APR first. With a bit of effort you could have £500 a month to throw at this. Once you are clear of debt you'll have even more spare cash to throw at a lease extension.

Long term, once debts and lease extension are sorted, you should think about a way to repay the capital owed on your mortgage. But for now make use of the very cheap IO mortgage and get yourself sorted out financially.

penguingirl

cfcboy wrote: »

Household bills (water, leccy, council tax etc) - £330

Apart from the things other people have mentioned (we ditched sky 2 years ago and don't miss it at all, replaced it with a humax freesat box so we can still record- but tbh that's unnecesary with iplayer etc), have you checked whether you can reduce your utilities? Always worth comparing gas/electric to see if you're on the right tariff and that they have your DD right. Also change BB/phone supplier- I would bet you can get a better price.

Also use cashback sites such as topcashback or quidco if buying utlities/ insurance/ anything over the internet- there can be good rates sometimes (we got £40 for swiching to talktalk even though they were the cheapest anyway)

cfcboy

mlz1413 wrote: »

As an outsider looking at your snapshot of finances I'd say spend a year getting to grips with your debts and learning to living not just within your earnings but on less so that you can start savings.

It seems from your posts that various things are happening that will stop certain monthly outgoings, ie the change of car and finishing a store card within 2 months.

Go to Martin's budget planner and fill it in, this will help you see what you pay out and stop you double adding things in. Main advise is to pay off short term high interest debt first. My advise is to use money you are not used to having to pay off further debts i.e. I pay my rates over 10 months, as I can live without that money each month on months 11 & 12 I pay a cheque for the rates value direct to my mortgage - therefore I never 'live' on that money.

Also MoneyBunny is on a downer! flats over shops do sell, they may have less appeal to some and they may not command top price but then you wouldn't have paid top price at the time either.

As for the lease one year really shouldn't make that much difference to the price of extending it and if you can stop spending every penny you earn then the £10k needed should be far more achievable.

Also I can't make out if you want to stay in the flat or want to move? You don't say you want to move more you want to sell to be debt free.....
I mention this because when I bought a leasehold flat it only had 55 years on the lease, I made the sellers extend the lease before I bought it, as they had no money this was all done on the sale day, my solicitors weren't happy about this so lots of clauses were written in and everything went fine. Obviously if you did this it would mean £10k less to buy somewhere else with so you have to decide what you want over the next few years to ensure you do things in the right order for you.

Many thanks for detailed post. I think the leasehold is the bit thats got me going. I didnt even realise it was too much of a problem 12 months ago, i think ive gone a bit ott now i know the situation and in my mind i needed to sort out immediatly! But you make a very good point, is the leasehold extension likely to go up between now and 12 months time, Im not entirely sure and ive asked for a legal view on this to see what im looking at in 12-18 months time.

the 3 estate agents ive spoke to said similar properties have been selling, above commercial and with shorter leaseholds so its not all doom and gloom. I live in area (not to big it up) but is one of the most desireable (according to reports) in the UK.. the Workingham, Berkshire district where properties are in hot demand and prices are over inflated above uk average. Good from a selling point of view but also has a reverse effect with buying!

Do i want to sell? Well thats a good question. Ive always wanted a garden, have a dog who would love it, misses gets to sit out there after work on a sunny day.. etc, you know the score with having a garden. Its not a huge priority but something we have always aimed at. When i found out about the lease extension it kind of accelrated my desire to leave, i might have put the frightners on myself this though which accelrated a desire to leave.

Id quite happily stay for another 12-18 months if it meant i had enough equity, good credit and less debts behind me. But like i said, the reason for the accelerated desire to leave is the lease hold value rising. Maybe i need to do a lot more digging around this and see what the likely costs are.

Thanks again

cfcboy

dimbo61 wrote: »

My view !
Renting somewhere else for £1K a month :-(
You have a very low Interest only mortgage payment now of £460
You need for the next 12 months to save every penny you can and clear debts
I doubt the cost of the lease extension will jump that much in 12/18 months .
Sit down with the other half and review everything
Lunch take a butty box with fruit/bread/fillings from Aldi/Liddle .
No papers, magazines, books. Buy the OH a kindle for Xmas/birthday great selection of free books/papers/mags all free.
Holidays in UK at campsites your child will love it.
Buy a cheaper car to run, tax, insure
It takes hard work and time to change bad habits you have built up.
I drive a 10 year old car, live cheaply and work hard to become mortgage free.
Can you get a second job ? Make stuff to sell ? Flog old stuff on eBay ?
Selling up and moving to rented would cost a lot of money and you could then struggle to buy another property as most lenders now want repayment mortgages
Only my views Good Luck

Got nothing less to sell LOL, ive got a laptop which myself and the misses use and an apple mac for my son to do his 6th form work with.

How do i attach an xls? Ive got a "as is" finance report and "going forward" xls but just wanted some guidance on where we can cut down some more.

cfcboy

SternMusik wrote: »

I agree with other posters that the key is to reduce your outgoings. You could live well for a lot less money I think. This isn't about being miserable all the time. If I was you I'd ditch things like Sky immediately. Sky doesn't make you and your family happy. If you want to spend money then do it on things that actually create memories for you and your child. Things like days out to the museum, picnics in the park etc are very inexpensive entertainment and far more stimulating than sitting in front of the telly. With the savings you make you could then attack the highest APR debt first (assuming it doesn't incur an early repayment penalty).

Another good post, so thanks. My son is just about to hit 17, he doesnt do the whole go out with parents at the weekend thing these days im afraid to say. He is out with his mates all the time or in his room with music or laptop. We do go for meals at times but you know what its like when you hit a certain age, you want to be out enjoying yourself, not stuck with the olds!

Sky is the one thing i refuse to budge on, if we plan to stay in a lot more to save then i got to keep the football. Ive already downgraded my account by removing movies etc but watching the football is really the only "me" time i get sadly. We have basic package with Sky sports but my broadband is due to be free for a year because of this so maybe not such a bad thing after all.

SternMusik wrote: »

Unless you need your iPhones for work I'd seriously think about selling them, getting cheap PAYG phones and ditching the insurance. It's all for the good cause of keeping an affordable roof over your head!

Sold one Iphone for cheap thing (got £350) but still tied into a £35 pm contract that has year to run. Ive got a £20 contract coming to end soon so i can save there. My son has a Ip5 on £35pm contract but i cant (now that ive let him have it) go back on that. Maybe i shouldnt have got him one in first place but he only child and we like him to have things most of his other mates have got. Whether thats a good or bad thing.. i will be only judge of that, each parent has different ideas on it tbh.

Misses on £20 Ip4 deal which is reasonable, not too fussed on this as she always within budget.

SternMusik wrote: »

Now, regarding your flat, and assuming you want to stay there, it is worth finding out how much a statutory lease extension is now compared to a year and two years from now. Compare the annual increase to the APR on your debt, and then attack whatever has the highest APR first. With a bit of effort you could have £500 a month to throw at this. Once you are clear of debt you'll have even more spare cash to throw at a lease extension.

Yep totally agree, im going to try and post an xls on here (somehow!?) to show now and possible costs to show where i can pay off and get some tips.

SternMusik wrote: »

Long term, once debts and lease extension are sorted, you should think about a way to repay the capital owed on your mortgage. But for now make use of the very cheap IO mortgage and get yourself sorted out financially.

100% agree, thats the aim anyway!

SternMusik

cfcboy wrote: »

Yep totally agree, im going to try and post an xls on here (somehow!?) to show now and possible costs to show where i can pay off and get some tips.

You can't attach files on MSE. Easiest way is to head over to the debt free wannabe board. Fill out a Statement of Affairs here: http://www.stoozing.com/calculator/soa.php . Copy/paste it into your post on the DFW board and the experts there will be on hand to help. This is a standard format which will make it easier for everyone to help.

The DFW guys will be more knowledgeable but your credit card minimum payment looks really high (if you really hardly pay anything off each month). Have you tried to get a 0% card to transfer your balance to? This could save you lots in interest, which gives you more spare cash to throw at the other debts.

Good luck with getting a 17y/o into a museum You could encourage him to get a little job on the side, so that he can pay for things like mobile phone contracts himself in the future. It is hard to not spoil your child though. (I am saying this as a financially sensible but spoilt child )

cfcboy

Many thanks, i will go that route.

Again, many thanks to all that have contributed, been a real help

cfcboy

SternMusik wrote: »

You can't attach files on MSE. Easiest way is to head over to the debt free wannabe board. Fill out a Statement of Affairs here: http://www.stoozing.com/calculator/soa.php . Copy/paste it into your post on the DFW board and the experts there will be on hand to help. This is a standard format which will make it easier for everyone to help.

The DFW guys will be more knowledgeable but your credit card minimum payment looks really high (if you really hardly pay anything off each month). Have you tried to get a 0% card to transfer your balance to? This could save you lots in interest, which gives you more spare cash to throw at the other debts.

Good luck with getting a 17y/o into a museum You could encourage him to get a little job on the side, so that he can pay for things like mobile phone contracts himself in the future. It is hard to not spoil your child though. (I am saying this as a financially sensible but spoilt child )

Something like this?

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1740
Partners monthly income after tax....... 1950
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 3690
Monthly Expense Details
Mortgage................................ 460
Secured/HP loan repayments.............. 485
Rent.................................... 0
Management charge (leasehold property).. 12
Council tax............................. 122
Electricity............................. 80
Gas..................................... 80
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 14
Mobile phone............................ 95
TV Licence.............................. 12
Satellite/Cable TV...................... 41
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 250
Petrol/diesel........................... 80
Road tax................................ 20
Car Insurance........................... 56
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 80
Childcare/nursery....................... 0
Other child related expenses............ 150
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 35
Buildings insurance..................... 50
Contents insurance...................... 15
Life assurance ......................... 30
Other insurance......................... 25
Presents (birthday, christmas etc)...... 65
Haircuts................................ 60
Entertainment........................... 350
Holiday................................. 0
Emergency fund.......................... 0
Ciggies................................. 200
Total monthly expenses.................. 3332

Assets
Cash.................................... 0
House value (Gross)..................... 185000
Shares and bonds........................ 0
Car(s).................................. 3500
Other assets............................ 0
Total Assets............................ 188500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 157000...(460)......3.5
Hire Purchase (HP) debt ...... 1500.....(85).......15<
Loan...........................12000....(400)......9
Total secured & HP debts...... 170500....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Tesco CC.......................2600......65........17
BarclayCard....................2000......45........18
Aqua...........................500.......20........35
Total unsecured debts..........5100......130.......-

Monthly Budget Summary
Total monthly income.................... 3,690
Expenses (including HP & secured debts). 3,332
Available for debt repayments........... 358
Monthly UNsecured debt repayments....... 130
Amount left after debt repayments....... 228
Personal Balance Sheet Summary
Total assets (things you own)........... 188,500
Total HP & Secured debt................. -170,500
Total Unsecured debt.................... -5,100
Net Assets.............................. 12,900
Created using the SOA calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using IE browser.